Bitcoin's market share is sitting at 'uncomfortably low' levels—a historical sign of market frothiness, JPMorgan analysts warned Monday.
Amid looming fervor over El Salvador's historic bitcoin adoption measure, the cryptocurrency market rallied to its highest level in nearly four months on Monday afternoon, with a slew of so-called altcoins surging to meteoric new highs and fueling gains that have prompted JPMorgan analysts to warn current crypto mania suggests the market may be ripe for a correction.frothiness, JPMorgan analysts warned Monday.
Though it's been underperforming the broader market in recent weeks, the price of bitcoin ticked up about 2% Monday to surpass $52,000 for the first time in nearly four months. Nigel Green, the CEO of $12 billion wealth advisory DeVere Group, chalked up the gains to anticipation overas legal tender in El Salvador on Tuesday, calling it a"landmark moment in the evolution of digital currency."
In a Monday note to clients, however, JPMorgan Managing Director Nikolaos Panigirtzoglou said retail investors have been propelling altcoins to new highs since early August and pointed out bitcoin and ethereum's share of the market has fallen from 78% on August 4 to about 67% amid waning institutional interest in funds tied to the two top cryptocurrencies.
He points out bitcoin's share of the market in particular looks"uncomfortably low" by historical standards—a likely reflection of"froth and retail investor mania," as opposed to sustainable gains.activity have helped not only ethereum but also alternative cryptocurrencies that facilitate or plan to facilitate smart contracts, such as Solana, Binance Coin and Cardano," Panigirtzoglou said Monday.
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